Taming Change with Portfolio Management

Reading the back cover (always good to do when reading a "textbook"), the bold claim is made: "While hundreds of books have been written about the various portions of this discipline, this is the first book to synthesize all the information into one definitive treatment of portfolio management". What is not explicitly said, however, is that the authors are respectively CEO / Founder (Pat Durbin) and Chief Solution Architect (Terry Doerscher) of Planview Inc, who provide an Enterprise Project Management (EPM) software tool focusing on portfolio management aspects. You need to ask yourselves the question as to whether this is a textbook that seeks to legitimise the principles behind the development of a specific tool, or whether that tool really does implement a definitive treatment of portfolio management.

Physical review first then. The book has around 350 pages broken down into six sections of twenty chapters. There are quite a few diagrams, some very simple and some that will take some serious thinking about. There are some screenshots from the aforementioned ERP that illustrate the "art of the possible", and to the authors' credit are not gratuitous product advertising. Pages are well laid out and the writing style is formal, but actually very readable. Make no mistake, this is a totally different style of book to the OGC's recent "Guidance on Portfolio Management" - it treats the subject with in-depth analysis, where maybe the OGC book was quite light.

First impressions are pretty favourable then. Not too big, very readable, salient diagrams and there's obviously some academic and practical pedigree in the authoring team. It's very tempting to try and summarise the content of a book in a review, but there really is so much content that this review will concentrate on what I particularly like and what I would have expected to see.

First and foremost for the PMOSIG review is that there is a good section on PMOs, acknowledging just like OGC that portfolio management will not succeed without an empowered PMO, skilled to tackle all aspects of the investment ecosystem (definition, selection, governance, assurance, review) and provide leadership and facilitation for all parts of the business that are involved with projects. Terry Doerscher has been talking about "PMO 2.0" for 5 years now, and much of what he says aligns directly with the OGC's P3O guidance. In fact some of it is so similar that it's becoming clear now that PMO evolution from project support into something altogether more valuable is not just a dream or an anomaly - it really is the direction that informed management are driving the management of the investment delivery ecosystem. There will be no major surprises for the regular PMOSIG conference attendees though! I would love to see this section of the book made available to PMOSIG members as a downloadable excerpt.

The "like list" for the book is pretty long, and in no particular order:

• There are some case studies included in the book. These appear to be gleaned from Planview customers, including not-for-profits, fast moving sales organisations and education. They really put a real-world angle on the concepts of portfolio management, and demonstrate the importance of getting the portfolio management ecosystem (a term which is used quite often within the book, and can be compared to the now-famous "organisational energy" diagram in the OGC tome) adapted to the individual company.
• There's good focus on "garbage in - garbage out" in terms of the importance of good investment opportunity data. Also, and critically, the book talks about "the importance of information parity", which is a posh way of trying to ensure that when you make investment decisions, you compare apples with apples, and not with things that only look like apples. For me, this is a fundamental of both the mechanics of portfolio management and also the confidence that a board can have in the decisions that it makes.
• The "Portfolio Process Map", although being quite scarily complicated, is a real gem of information, guidance and alignment, and you could probably say that this is the key page in the whole book. Covering the concepts of demand, capacity, cost and benefit and the process areas of operational planning, investment analysis, work and resource management and finally value delivery, this is a potential lifesaver for anyone who is tasked with implementing portfolio management from scratch, or refining and existing portfolio management ecosystem.
• I love the chapter on "leveraging technology". I was expecting to see quite a partisan sales pitch, but actually it's full of great advice and common sense which leaves you in no doubt that you need the complexity of portfolio management to be tamed by the appropriate use of tools. Few of us who have wrestled with poorly designed spreadsheets that can't handle relational information structure will disagree with this revelation!

There are a few "misses" as well - ones which I would consider particularly important:

• Who is the "portfolio manager"? What skills (hard and soft) are pre-requisite for the role? How do you develop into such a role? These are key questions for me, as there has to be a point of accountability to keep the ecosystem operating and evolving.
• The OGC guidance was quite good in identifying the "run the business / change the business" cycle, but went into little detail. I was hoping that the book under review might shed some further light on this topic area but sadly not, focusing purely on change elements.
• The book is poor on business cases and their production, the audit and assurance of them, and how they are normalised across a business. This is a bit of a dichotomy given the focus on "information parity"! The rewrite of the OGC guidance is said to have much more of a focus on business cases and benefits definition and realisation - I await this keenly!
• The concept of "fit to invest" exists in some companies, and just like project managers with a poor delivery record being treated appropriately, project sponsors with a poor record of delivering the expected benefits are now starting to be managed according to results. I expect to see much more of this aspect of portfolio management coming to the fore in the next few years.

Overall then, would I recommend this book? The answer has to be a resounding "yes", especially when read in conjunction with the OGC's P3O and Portfolio Management guidance. There's definitely enough content to justify buying the book for any PMO, whether you're involved in portfolio management or not, and it is written well enough to not be consigned to the bedside table as an insomnia cure, which is strong praise indeed! Was it the expected sales pitch for Planview? To my surprise and delight, it isn't anything of the sort!

-- Reviewed by Chris Walters

ABOUT THE REVIEWER; Chris Walters is the Chairman of the PMOSIG, the independent Programme Management Office Specialist Interest Group

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